Law

What Happens When You Get Divorced from Your Business Partner?

Business-PartnersGoing through a divorce is never an easy event. Even if you both agreed to the divorce, splitting up your possessions and dealing with the court or divorce lawyers can be a real nuisance and nightmare.

Although this situation may not be fun to deal with, it can get even uglier if you and your ex own a business together. There are a variety of scenarios that can happen when you get divorced from your business partner, and the following are a few of the events that may occur.

You have a choice.

When it comes to your business and divorce, the first thing you have to understand is that you have a choice. You can both stay and opt to keep the company alive, or you can walk away. The choice you make will depend on your legal ownership of the company as well as whether or not you want to deal with it once the divorce is finalized. Be sure to think long and hard about what you want before heading into the mediator or lawyer's office, as this will help prepare you for what may come next.

Ownership will be determined.

Before anything will legally happen with your business, the very first thing that a lawyer is going to do is to determine ownership. This is necessary to ensure the next steps are the right moves to make. For example, if you owned the business before you got married, it's possible that your ex will not have any claim to the business, therefore allowing you to remain the sole owner.

However, if you and your ex split ownership of the company, or if the company was started after the marriage occurred, then your lawyers will need to determine which the best route to take for both parties is.

You and your ex can remain business partners.

If both you and your ex want to remain owners of the business, you have that option. Before you agree to this, though, be sure that you can put your personal history behind you and still work together while making smart decisions for the company. If there is a chance that you two will not be able to work well together, then this may not be the best option for the success of the business.

The company will be split.

If you and your ex cannot both remain on as owners, another option will be that the company's assets become divided between the two of you, just as it would with your jointly-owned car or house. It will be determined how much each of you has invested in the business as well as the value of the business. You then have three options: you or your ex can buy the other person out to become the sole owner; you or your ex can sell a portion of your ownership in exchange for shares; or you can agree to dissolve the business.

No matter what option you choose, it's always best to have a family lawyer on hand to help you make the best possible decision for the future of your business due to divorce.

Do you have any questions? Please ask.